Option to Profit
Week in Review
JANUARY 4 – 8, 2016
|NEW POSITIONS/STO||NEW STO||ROLLOVERS||CALLS ASSIGNED/PUTS EXPIRED||CALLS EXPIRED/PUTS ASSIGNED||CLOSED||EX-DIVIDEND|
|1 / 1||0||0||0 / 0||4 / 0||0||2|
Weekly Up to Date Performance
It doesn’t get much worse than this past week.
In fact, if you’re talking about the worst week ever to start a new year, it has nver been worse than this past week.
There was just one new position opened on the week and that was one position too many, even as it looked as if it may have been a good decision for just a few hours.
That position ended the week 6.1% lower while the adjusted and unadjusted S&P 500 were both 5.9% lower.
The only shred of good news was that as bad as the week was, the existing positions still fared better than the overall market, but that is rarely any real solace.
Existing positions outperformed the S&P 500 by 1.8%, but that still meant that they were 4.1% lower on the week.
A loss is a loss.
There were no assignments on the week. No surprise, there.
The loss for this week was pretty stunning, especially since so many were of the belief that the flatness of 2015 was bound to translate into a good 2016.
That still may be the case, but the hole dug in the first week of the year is a pretty deep one.
So deep, that no first week of the year has ever witnessed those kind of depths.
There was absolutely nothing of virtue to report upon for the week.
With only one new purchase and 2 ex-dividend positions, there was no generation of meaningful income and any hope of rollovers was dashed by mid-week, as the losses piled on and on.
That leaves us with next week.
That’s the final week of the January 2016 option cycle and things don’t look very optimistic.
With a fair number of positions set to expire next week, I already had my thoughts on early rollovers, but there wasn’t a single moment during the course of the week that offered any opportunity to push your troubles down the line.
With an avalanche of bad news this week it’s not too surprising that our markets swooned.
We were through this barely 6 months ago when China went south and are now back again.
At that time I was expecting that the respite we saw was going to be short lived. I really didn’t expect it to have lasted this long.
Now the question is when we will realize that we are the dog and that the tail shouldn’t be wagging us.
With no assignments this week and with relatively little cash, I don’t expect to be on the lookout for any places to part with my money.
With no sign of relief and selling getting worse and worse as the final day of the week wore on, there’s no reason to think that we’re at the end of the selling and we certainly didn’t see very many people showing their bravery during the course of the week.
Those that did probably have some regrets about having done so.
With today’s drop we’re again 10% below the August high, but we’re also about 9% below the recovery high in November 2015.
Those mental landmarks in charts can either be support or can offer no resistance at all.
Back in August there was no resistance at all and it pretty much came in one big swoop.
This week there were lots of those swoops, but the numbers to be on the lookout for on the S&P 500 are 1913, then 1884 and then 1867.
I’d prefer not to see those get tested and would trade off some of the increased volatility for some price recovery.
(Note: Duplicate mention of positions reflects different priced lots):
New Positions Opened: MS
Puts Closed in order to take profits: none
Calls Rolled over, taking profits, into the next weekly cycle: none
Calls Rolled over, taking profits, into extended weekly cycle: none
Calls Rolled over, taking profits, into the monthly cycle: none
Calls Rolled Over, taking profits, into a future monthly cycle: none
Calls Rolled Up, taking net profits into same cycle: none
New STO: none
Put contracts expired: none
Put contracts rolled over: none
Long term call contracts sold: none
Calls Assigned: none
Calls Expired: BAC, BBBY, DOW, MS
Puts Assigned: none
Stock positions Closed to take profits: none
Stock positions Closed to take losses: none
Calls Closed to Take Profits: none
Ex-dividend Positions: CSCO (1/4 $0.21), GPS (1/4 $0.23)
Ex-dividend Positions Next Week: WFM (1/13 $0.135)
For the coming week the existing positions have lots that still require the sale of contracts: AGQ, ANF, AZN, BBY, CHK, CLF, COH, CY, FAST, FCX, GDX, GPS, HAL, HPQ, JCP, JOY, KMI, KSS, LVS, M, MCPIQ, MOS, NEM, RIG, WFM, WLTGQ (See “Weekly Performance” spreadsheet or PDF file)
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